Tuesday, Brink's Co. (BCO), a provider of cash logistics and security-related services to financial institutions, reported lower earnings for the first quarter hurt by impact of last year's currency conversion project in Latin America, higher severance costs in Europe and unfavorable foreign exchange rates.
Net income attributable to Brink's declined 54% to $23 million or $0.49 per share from $50 million or $1.07 per share in the corresponding period last year.
Earnings from continuing operations fell to $22 million or $0.48 per share from $33 million or $0.70 per share in the same period last year. On average, six analysts surveyed by Thomson Reuters expected the company to report earnings of $0.47 per share for the quarter. Analysts' estimates typically exclude special items.
The company attributed the decline to the inclusion in last year's results of income from the currency conversion project in Latin America and higher retiree expenses in this year's results, partially offset by lower corporate costs and higher profits in North America.
Revenues declined 8% to $733 million from $793 million in the year-ago period. Five Street analysts expected the company report revenues of $778.67 million for the quarter. Stronger U.S. dollar reduced revenue by 11% or $89 million. On a constant currency basis, revenue grew by $28 million. The organic revenue growth rate was 1%.
Segment operating profit declined to $54 million from $82 million in the year-ago quarter impacted by lower profits in Latin America and Europe, partially offset by increased profits in North America. Segment-operating profit margin declined to 7.4%, from 10.3% in the same period last year. Unfavorable currency exchange rates reduced segment profit by $4 million.
First-quarter revenue from international operations was $512 million, down 9% from $563 million in 2008 due mainly to unfavorable foreign exchange rates. On a constant currency basis, international revenue was up 5%. Revenue from North America operations were $221 million, down 4%, as higher average selling prices were offset by lower volume. On a constant currency basis revenues were flat.
Europe, Middle East, Africa or EMEA revenue declined 12% to $293 million. Operating profit was down substantially when compared to the year earlier period due to lower margins in most European countries, continued weakness in diamond and jewelry markets and $5 million in severance costs.
Latin America revenue declined 5% to $199 million. Excluding the effects of the currency conversion project and foreign exchange rate changes, operating profit improved over last year.
Asia-Pacific revenue was $19 million, flat when compared to the year-ago period but increased 7% on a constant currency basis. Operating profit declined mainly due to the negative impact of foreign exchange rates and lower diamond and jewelry volume, partially offset by increased volume in currency and precious metals.
Looking ahead, the company said results for 2009 would continue to be affected by global economic crisis.
BCO is currently down $0.68 or 2.23% and trades at $29.80.
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